BP gets go-ahead for deepwater gas exploration

BP is set to work with CNOOC to explore deepwater fields in the South China Sea.

UK-based BP has obtained approval from the Ministry of Commerce to start work with CNOOC on its second deepwater project, located in a gas field known as block 43/11. BP will have a 40% share of the project, which will then be reduced to 20% once the field starts production. The deal was signed when Chinese vice-premier Li Keqiang visited the UK in January.

A CNOOC drilling rig Image: CNOOC

Although neither company has given a specific timeframe for commencing the exploration, CNOOC has announced plans to use its first semi-submarine drilling rig, which was completed in mid-2011, within in the first half of this year. The rig will work at depths of 3,000 metres and will be capable of extracting oil from sources as deep as 12,000 metres.

BP China President, Chen Liming, sees deepwater exploration as one of the “four areas of opportunity” the company wishes to exploit, the other three being integrated refining and chemicals, natural gas and high-end lubricants.